February 11, 2026, Issue 23

The Market Gives and The Market Takes Away

For those of us more heavily invested in the high reward arena of tech stocks, the last couple of weeks have shown us the high risk side of these stocks loudly and clearly. While the Dow Jones has climbed to a new closing high, the Nasdaq is about 1,000 points off of its most recent all-time record. Companies that were market darlings, and have even posted terrific quarterly results have been punished as investors continue to transition away from tech and into safety. Let’s take a graphic look at what I mean.
There has been no bigger market darling than Palantir over the last two years. We bought into Palantir almost exactly two years ago, paying $16.60. Friday’s close of $135.90 is still a hefty return of over 700%. At the same time it is about 35% below its all-time high achieved just 3 months ago.
One of the stocks we liked a lot was Reddit. We had bought in at $143 back in August of 2025, and sold our final shares in January at $250. It has fallen to $139 as of Friday after excellent results, and raising guidance for the coming quarter.
Microsoft, Robinhood, Crowdstrike, and Tesla are all way below their recent highs.
So what does it all mean? Market players are worried about many issues they feel are upcoming. First and foremost is the rate of capital expenditures or capex. Google’s parent company Alphabet announced during their earnings call that they would be spending about double last year’s spend to continue to build out their AI ambitions. The estimated spend? $185 billion in 2026 alone! So the question is simple: What will the return be on this enormous investment? The answer is somewhat unknown, although Google has consistently shown they can monetize everything from a search engine to You Tube. If you add companies like Microsoft, Amazon, and Meta to the Alphabet spend, the number balloons to around $700 billion this year. And here I am, worried about a new pair of runners for my upcoming 10K!!
But seriously folks, what will the return on the investment be, and when will we see it? Companies are starting to go into the debt markets to raise cash to spend, and that is where it becomes scary. In my mind, this is similar to the dot com boom of the early 2000’s. The strong will not only survive, they will be richer for it. Companies like Nvidia and Broadcom that provide the chips, as well as Seagate and Micron that provide the storage will surely benefit immediately, and their share prices reflect that reality. With others it’s wait and see, but I believe the biggest and most profitable today will be there standing tall at the other end. And for that reason, this pullback may be providing opportunities. As I have said in this space many times, sometimes the stock market goes on sale. When it does, most people panic. But let’s not do that. Instead, let’s see where investors ofr long term gains may be finding bargains.

Stocks on Sale

If you one of the many people who missed run-ups in some favorite tech stocks, this may be the moment where you look backwards in a year or two and say “I should have jumped in at the start of 2026”. Here are some of my favorites. They come either from stocks we own and would buy more of at these levels, or our watchlist where we may jump in at any moment.

Palantir – PLTR – As some readers may know, I was in this name early, and out way too early. But those days of $20 PLTR are gone for good. The company is growing at an extraordinary rate. Their AI platforms are being used by governments and defense, commercial enterprises like Lowe’s and Walmart, healthcare (Cleveland Clinic), as well as manufacturing. This month, they reported sales of $1.41B, an increase of 70%, while saying that revenue in 2026 will rise by a further 60% to $7.2B for the year. For 2025 they had $1.625B in profit compared to $467M in 2024, an astounding 3.5 times growth rate. They believe they are in the early innings of the AI revolution, and we have no reason to doubt CEO Alex Karp. Shares are trading at $139, significantly below their high of $207 reached just 3 months ago.

Amazon – AMZN – Amazon started out selling books on the internet. Many observers thought Jeff Bezos was nuts. How will this make any money? Well, the man is now the 4th richest person on the planet, worth around $240B. Clearly, he had a vision. Today, the company he founded has multiple income streams through retail, web services, streaming, advertising, and devices to name a few. The AI personal shopping assistant, Rufus has gotten great reviews and they are continuing to invest in that arena. I have no doubt that Amazon will look like a winner over the long haul. Its shares have fallen from a recent high of $258 to today’s $206.

Microsoft – MSFT – The company that Bill Gates built still runs about 65-70% of all businesses through the Windows platform. 30% still run the Office suite of products. Their AI efforts are getting better by the day as Co-Pilot ramps up. And of course, this is where they will continue to invest heavily. They increased revenue in the last quarter to $81B with a profit of $4.14 per share. Both numbers beat expectations of analysts by a wide margin. However, the share price has come off of a 2025 high of $555 to today’s sale price of $413.

I understand that some of these companies’ stock prices are high for the average investor. However, if you have a broker that does not charge commissions, as is the norm today, then you can still see outsized returns from even one or two shares. Even if MSFT just gets back to its 2025 high, you would be looking at a return of 34%. Not too shabby.

Are there any stocks you are wondering about? Let me know and I will come back with my thoughts.

Speculation

So where does all of this market uncertainty leave our speculative stocks? The short answer is in the basement. I’ve advocated for speculation, as it likely provides the highest return. However, I have also advocated for using only a small percentage of your overall portfolio to speculate with. We have suffered through the last few months watching companies like SNAP, PTON, and JOBY get hammered in the market. Here is my plan for this group:

Snap Inc – SNAP – Snap announced a beat on sales for Q4 2025, as well as a $500M share repurchase program. With $1.7B in sales and $45M in profit (up 4 fold from $9.1M a year earlier), we are contemplating adding to our position as the market seems to have beat the stock down irrationally. The deal with Perplexity AI is kicking in starting now, and its subscription-based business, Snapchat+ has grown to 24 million users. It has fallen to $5.23, and today analysts at Arete put a BUY rating on SNAP with a $7.30 price target in 12 months. This would represent a 39% return. We agree.

Peloton – PTON – After reported a mixed bag of tricks, I am a little cautious with Peloton. Sales fell a little short of estimates, but profit was higher. They seem to be executing the plan to get into public spaces (gyms, hotels) and the equipment issues and recalls seem to be behind them. We averaged down, but are still in the $6.65 range on our position. Normally, I would advocate averaging down some more, but our position is large, and I want to see what the current quarter has in store before making that call. For now, this is a wait and see stock.

Joby Aviation – JOBY – The maker of Evtols (Electric Vertical Take Off and Landing Taxis) has expanded production for 2026 in advance of FAA approval. I firmly believe that this will happen, potentially before the start of the 3rd quarter. Deals are signed in the UAE and Saudi, and I believe more will come. I still picture the finance bros hoping in a Joby Taxi from the top of a building on Wall Street and heading for the Hamptons on a Friday afternoon. Joby has traded down to the $10 range with people pulling away from speculative stocks. This is a good spot to average down or begin a position.

Speaking of speculation, what the heck is with Bitcoin? I was led to believe this was a store of value like gold. Only a limited number of Bitcoin, becoming mainstream, not based on a fiat currency. Blah, blah, and blah. I never understood it, still don’t, and hate investing in what I don’t understand (as Warren Buffet would say). We have a small position in a Bitcoin ETF, and we will hold on to see where this goes. Does anyone have strong feelings on crypto? Please enlighten us!!

More Stock Analysis to Come as we Digest Earnings Reports
Check back soon for more corporate news. In the meantime here is some food for thought about the joys of this life…

Thought of the Day

In life there are terrible moments and great moments. We likely sent sad thoughts throughout the Dadsadvice community with the news of Ginger the Golden Retriever’s passing.
This week, we present the great moment, and it way outshines the bad. The Mrs. and I are so thrilled to say that our eldest is engaged!! The young man is wonderful, and is frankly a part of the family already. We cherish these moments of celebration, family, and a future filled with happiness and prosperity!
Life is good!!